Robbins LLP: Nimble Storage, Inc. (NMBL) Misled Shareholders According to a Recently Filed Class Action
Robbins LLP announces that a class action complaint was filed in the U.S. District Court Northern District of California. The complaint alleges that officers and Directors of Nimble Storage, Inc. (NYSE:NMBL) violated the U.S. Securities Exchange Act of 1934 between May 27, 2015 and November 19, 2015, by making materially false and misleading statements about Nimble Storage’s business prospects. Nimble Storage provides flash storage solutions that “enable the consolidation of all workloads and eliminates storage silos by providing enterprises with significant improvements in application performance and storage capacity.” The company concentrates on three main areas in terms of sales and marketing: (i) U.S. Commercial; (ii) Large Enterprises; and (iii) International.
Nimble Storage Accused of Providing Misleading Financial Information
According to the complaint, even before the class period, Nimble Storage was being negatively impacted by intense competition from large competitors who were slashing prices to maintain market share. To combat this competition, Nimble Storage focused its sales and marketing efforts towards its Large Enterprises market and reduced sales efforts in its U.S. Commercial market, which resulted in the loss of sales in both sales channels and poor financial results.
The complaint alleges that beginning on May 27, 2015, and continuing through the class period, Nimble Storage touted its strong performance and provided strong financial projections for future performance. Nimble Storage stock rose on these comments.
On November 19, 2015, after the market closed, the company issued a press release announcing its financial results for the fiscal third quarter of 2016. The company reported a non-GAAP operating loss of $10.8 million or negative 13% of revenue, and a GAAP net loss of $28.6 million, or $0.36 per basic and diluted share, well below analysts’ forecasts. The company acknowledged that its “shift in investment from commercial to enterprise business impacted our commercial revenue growth more than we anticipated.” Nimble Storage lowered its guidance for fiscal fourth quarter of 2016 to a loss of $0.11-$0.13 per share on revenue of $87 to $90 million. This estimate is significantly below analysts’ forecasts that the company would break-even on revenue of $99.3 million. On this news, Nimble Storage stock fell $10.34, or 51%, to close at $10.05 on November 20, 2015.
Nimble Storage Shareholders Have Legal Options
Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, or you can complete the form below and we will contact you directly.